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Can craft beer really boost North Country jobs?

Sep 09, 2013 — Senator Charles Schumer and North Country congressman Bill Owens say a tax cut could boost the number of craft breweries in New York.

The two Democratic lawmakers are pushing legislation in Washington that would cut the national excise tax on smaller beer-makers by fifty percent.
Chris Ericson leads the pack of politicians and reporters through the guts of his small brewery in Lake Placid – store rooms full of bagged barley, shining vats with crowns of creamy yeast.
Ericson tells Senator Charles Schumer that his company’s production of beers like Ubu and Lake Placid IPA now top seven thousand barrels a year — most of it brewed at an off-site facility in Utica.
"Two years ago, I would say we did about 4500 [barrels]," Ericson says. The company now sells its beer in nine states. "We're going into Virginia and Maryland."

Schumer is here today, along with Congressman Bill Owens, to push for a big cut in the Federal excise tax charged for each barrel of beer produced by these small, craft brewers.
Beer-making sounds like fun, weekend stuff, but Schumer says in New York it’s big business and could get bigger.
"In New York state, the beer industry supports about 8,000 jobs through brewing and distribution, about 60,000 jobs when retail is put into it," he argues.

Ericson says cutting the excise tax in half, as Schumer proposes, would save his small company as much as 20 thousand dollars a year. He says that would allow him to invest more and expand more.

"We completed a large renovation [and] increased our brewing capacity by sixty percent," he says. "We put in six new tanks, we put in a new kitchen, we increased about 20 jobs in the last year here in the pub itself."
Kevin Litchfield is the master brewer here. He went to school at Paul Smiths College and says he’s convinced that for people like him, artisan food and beer production can offer real opportunities.
"When I started, I was the only brewery employee," he says. "I feel extremely lucky to have a job in the North Country, where I can live and do what I like to do up here."

In recent years, new small breweries have also opened – in Canton, Saranac Lake and Tupper Lake.

One of the arguments being made here today is that these artisan foods – not just beer, but also cheese and maple syrup and other products – have other economic benefits, including publicity.

These products offer free advertising whenever they land in someone’s refrigerator. Jim McKenna heads the Regional Office of Sustainable Tourism in Lake Placid.

"Not only does it provide for industry here, but provides for more excitement coming to the area," McKenna says. "They all identify the Adirondacks."

One other benefit, according to Ericson, is that brewers are working more and more to find local ingredients, buying direct from North Country farmers.

There’s actually a bill in the state legislature that would encourage more local buying for brewers. Ericson says he supports that legislation, if it’s tweaked to allow more flexibility.

One wrinkle to all this talk of North Country beers is that the vast majority of the beer that’s branded with the name Lake Placid or Saranac or 46er or Adirondack is actually brewed outside the region – mostly in Utica.

Ericson actually shifted his operation from Plattsburgh to central New York. The big hurdle, he says, is transportation.

"Beer is heavy and it's heavy to ship," he notes.

Ericson says he would love to open a full-scale brewery here in the Adirondacks, meaning far more local jobs. But he says that would add a significant cost to each bottle of beer sold outside the region.

"That's the biggest challenge. It's not the facility, it's not the capital to do a facility up here, it's 'Can you get the market at a competitive price when you're adding $2 to a case of beer in a transportation cost."

So one worry going forward is that the market could be flooded more and more with products that carry North Country brand names that don’t actually produce North Country jobs.